2. Competitive advantage

3. Technology-based companies

R&D costs and subsequent investment requirements are low, and excellent companies enjoy a considerable defensive competitive advantage. The characteristics of technology-based company success:

a. More cash.

b.The bigger the better.

c. Financial stability, predictable.

d. Rapid growth, into the mainstream market.

e. Provide a full range of services; Sales ability and access to distribution channels.

4. Human resources-based companies

These companies lack attractiveness. The characteristics of a company based on human resources success:

a. Product differentiation.

b. Providing essentials or low-cost services.

c. Organized growth.

5. Companies based on solid assets (tangible assets)

These companies are highly competitive, with extremely low gross margins and high operating leverage. The characteristics of a company based on solid assets (tangible assets) success:

a. Cost leader, the company's cost structure and operating efficiency can refer to fixed fee turnover rate, operating margin and return on capital, and then compare with industry peers.

b. Unique assets; c. prudent financing.

6. Summary

Not subject to Wall Street concerns, may be underestimated. Technology-based companies are often more attractive than companies based on human resources and solid assets such as air transport, garbage disposal, and express delivery. The industry is a variety of long-term investments that focus on scale advantages and cash flow.